Exclusive: California to discuss linking carbon market with China

SAN FRANCISCO (Reuters) - California Governor Jerry Brown said on Thursday he will discuss merging carbon trading markets in his state and China when he travels to Asia later this week, a sign of the governor's ambition to influence global climate change policy.

Brown discussed his plans in a telephone interview after U.S. President Donald Trump announced he would withdraw the United States from the landmark 2015 Paris climate accord, a global agreement to fight climate change. The move fulfilled a major Trump campaign pledge, but drew condemnation from U.S. allies and business leaders.

Brown, who vigorously opposes the United States' withdrawal from the pact, lambasted Trump's decision to pull out of the Paris accord as "insane."

He has been working with states and provinces around the world to set voluntary agreements to address global warming. The governor heads to China on Friday for meetings focused on climate change.

California has the largest carbon trading system in the United States and has frequently hosted officials from China, which has launched seven pilot regional trading schemes.

China also plans to roll out a nationwide market later this year, but the launch faces possible delays amid unreliable data and other regulatory problems, according to a government researcher.

California's system, which is known as "cap and trade," is already linked to Canada's Quebec market.

"I think that is a heavy lift to include Chinese provinces, but we are definitely taking that possibility very seriously," Brown said.

"We want to make sure it has full integrity and know exactly what's going on. And we can’t say that today," he said. "Maybe we don’t put it right in the same cap-and-trade regime, maybe some parallel regime," he added. "I am going to discuss that with the highest officials in China this week."

Brown will be meeting regional and national officials over the course of a week-long trip to China and will host a clean energy forum.

Trump has also sought to engage China, hosting President Xi Jinping at his Mar-a-Lago resort in Florida in April. Critics say that the U.S. exit from the Paris accord sets up China to take on a higher-profile global role.